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Fixed and Variable Cost Analysis

Able Company and Baker Company are competing companies that sell a product at the same price. Both companies are operating above the break-even point and have similar total profits. Able Company's costs are mostly variable, whereas Baker Company's costs are mostly fixed. In a time of increasing sales which company will tend t

Book Value of common stock and preferred: Cleveland Company

Cleveland Company reports the following information as of 12/31/2012: -10% cumulative preferred stock, par value $100, One-year of dividends in arrears; 20,000 shares authorized; issued, 10,000 shares; $1,000,000 -Common stock - authorized 500,000; 40,000 outstanding

Taxation: Office in Home, Casualty loss, Hobby loss

Problem 39 David is a college professor who does some consulting work on the side. He uses 25% of his home exclusively for the consulting practice. He is single and 63 years old. His AGI (without consideration of consulting income) is $45,000. Other information follows: Income from consulting business $4,000 Consulting

Understanding Management Accounting

Scapens, R.W (2006) 'Understanding Management Accounting Practices'. The British Accounting Review, 38(1) pp.1-30. What are the achievements of the Burns and Scapens frame work for studying management accounting change? What are the limitations and extensions of the study? Mention some processes shaping the management accou

Marginal costing

Rapid Auto has over 200 auto-maintenance service outlets nationwide. It provides primarily two lines of service: oil changes and brake repair. Oil change-related services represent 63% of its sales and provide a contribution margin ratio of 20%. Brake repair represents 37% of its sales and provides a 60% contribution margin rati

Fluctuating numbers

The benefit of vertical analysis is certainly the benefit of comparing companies of two different sizes. Looking beyond the numbers and focusing on the changes in the numbers can provide a seasoned analyst some very useful information about the company operational effectiveness. The usefulness tends to breakdown when you c

Relevant and Irrrelevant costs

Skanda Inc. manufactures table lamps, and it has traditionally made its own lampshades for its lamps. It computes the cost of manufacturing each lampshade as follows: Direct materials $4.00 Direct labor 6.00 Applied variable overhead 50% of direct labor cost Skanda currently manufactures 40,000 table lamps and l


1. If during the current accounting period the company's assets increased by $24,000 and equity increased by $5,000, then how did liabilities change? A. Increased by $29,000 B. Increased by $24,000 C. Decreased by $5,000 E. Decreased by $19,000 F.Increased by $19,00

Process for Developing the Common Size Statements

Describe the process for developing the common size statements and illustrate, using a company of your choosing, the development and interpretation of this analysis. Once the common size statements are developed, what comparisons (of the metrics in the common size statements) seem relevant in generating meaningful conclusions? D

Accounting: Annual Report Analysis

See the attached file. The annual report to use is The Buckle, Inc 2009. Stock symbol is BKE. Problem 1. State the values of the following accounts or variable names as reported by Buckle in its 2009 financial statements (p. 31-34) and explain their meaning (no more than one or two sentences). (1) "Income from oper

Business Startup; organization expenses; date a business begins.

Read IRC at Read IRS Pub 535, pages 26 - 27 Read Treas. Reg. 1.195-1 Discuss the issues and consequences inherent in IRC section 195 including, but not limited to, the following:

Lowe's Home Improvements - Preparing Income Chart and Profit Sales

As the fund manager for a large mutual fund, you are preparing for a conference call with all your major investors. You plan to e-mail everyone with an attachment that will serve as a guide for the upcoming call. You know investors' time is limited, so you want to be focused in your brief report. Because there are numerous figur

Can any accounting step after a worksheet be skipped?

The worksheet often facilitates the end-of-period (monthly, quarterly, or annually) accounting and reporting process. The use of a worksheet helps a company prepare the financial statements on a more timely basis. The main reason is that the company does not have to wait until it journalizes and posts the adjusting and closing

EPS using tax rate and expenses

Use the information for Sports Baseballs, Inc. Sports Baseballs, Inc. is a corporation that manufacturers and sells baseballs across several states in the Southeast. It had sales of $2.7 million during the last year. Expenses were as follows: Cost of goods sold............................... $1.2 million Admin

Taxes with Stocks and Trusts

A) Raquel transferred $100,000 of stock to a trust, with income to be paid to her nephew for 18 years and the remainder to her nephew's children (or their estates). Raquel named a bank as independent trustee but retained the power to determine how much income, if any, will be paid in any particular year. Is this transfer a co

Accepted Accounting Principles

2. State two generally accepted accounting principles that relate to adjusting the accounts. 3. Rick Marsh, a lawyer, accepts a legal engagement in March, performs the work in April, and is paid in May. If Marshâ?? law firm prepares monthly financial statements, when should it recognize revenue from this engagement? Why?

Effectiveness of On-line trading platforms

Do you think online trading platforms have helped investors make money? Does it help to have access to your 401k or brokerage statement all the time? How does this compare to when people in the 1940's, 50's and maybe into the early 60's would keep stocks they bought in a safe deposit box in the bank and maybe hold those stock

Sale of Assets Received as a Gift and Inherited

Daniel receives 400 shares of A&M Corporation stock from his aunt on May 20, 2009, as a gift when the stock has a $60,000 FMV. His aunt purchased the stock in 2002 for $42,000. The taxable gift is $60,000 because she made earlier gifts to Daniel during 2009 and used the annual exclusion. She paid a gift tax of $9,300 on the gift

Maintaining CPA License, Auditor Reports

6-After individuals become licensed in accounting, type typically must do what? A. Work for an auditing firm for 120 hours. B. Continue their education by acquiring CPE's. C. Become an Enrolled Agent with the IRS. D. Open a public practice in accounting. 9-If a company has changed accounting principles, the auditor will i

Plant assets/asset is being depreciated at a rate of $500

1.Plant assets are: tangible assets used in the operation of a business that have a useful life of more than one accounting period. current assets. held for sale. intangible assets used in the operations of a business that have a useful life of more than one accounting period. 2. An asset's book value is $36,000 on Ja

Missing amounts - process costing

See the attached file for the tables. Using the data presented below, determine which figures should be inserted in the blank spaces Beginning Units in Process Units Started in production Units transferred to finished goods Ending units in process Equivalent units a) 600 8,000 8,600 ? ? b) 900 6,500 ? 400-

Income from operations and net income

Selected information taken from the financial statements of Fordstar Co. for the year ended December 31, 2010, follows: Net cash provided by operations...$98,000 Cost of goods sold.........................$310,000 Selling, general, and administrative expenses...$124,000 Accounts Payable....$90,000 Extraordinary loss from

Internal Control Accounting Periods

Define what it is meant by internal control. Provide a minimum of three examples. It is the end of the accounting period, and your boss asks you to help determine the inventory balance to place in the company's balance sheet. Explain which physical quantities of inventory that you will include, and which you will exclude.